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As Clive Palmer falls, Nick Xenophon soars

Soon after Jacquie Lambie's sexually explicit description of her ideal man during a radio interview, the Tasmanian senator ran into Nick Xenophon in a Parliament House corridor.

"Hey Jacquie," said the independent senator for South Australia who, like Lambie, is single. "I heard you want a man with a lot of money, who doesn't talk much and has a big package?"

Illustration: Rocco Fazzari
Illustration: Rocco Fazzari 

That's right, acknowledged Lambie. I can't help you with any of that, Xenophon quipped. 

Xenophon can never resist a gag. And he is unfailingly self-deprecating. Not only in word but also in habit. The man who wears $99 suits from Lowes insists on flying economy. Even when he's given an upgrade for free. 

Independent senator Nick Xenophon.
Independent senator Nick Xenophon. Photo: Alex Ellinghausen

Qantas moved him into business class on a flight from Jakarta to Sydney.  "I broke out in a sweat," he relates. "I just didn't feel at home there." 

He doesn't broadcast it, but he flew to Jakarta twice, at his own expense, to plead for the lives of Andrew Chan and Myuran Sukumaran.

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He asked to be allowed to return to economy. "The four cabin attendants looked at me and they said, 'Between us, we have 80 years' experience and that is the most stupid thing we've ever heard.'"

He estimates that his preference for economy saves taxpayers about $80,000 a year.

Clive Palmer's 2014-15 donations were belatedly revealed in official Australian Electoral Commission figures.
Clive Palmer's 2014-15 donations were belatedly revealed in official Australian Electoral Commission figures. Photo: Alex Ellinghausen

At the time of his corridor exchange with Jacquie Lambie, she was a member of Clive Palmer's party, the party wielding the balance of power in the Senate on legislation where Labor and the Greens were combining to block the government. Since then, Lambie has quit, followed by Glenn Lazarus, leaving Palmer's party with just one senator, Dio Wang, a former employee of a Palmer firm. Comically, Palmer has given him the title of party whip, responsible for rounding up all the party's many senators for key votes. 

Palmer's party now has no more influence over the outcome of Senate votes than any other lone senator. 

'Radical centrist'

And, since then, Xenophon has announced that he's going national. As Palmer has failed, Xenophon has thrived. A restless Australian electorate, disenchanted with the two main parties, remains in hopeful quest of a decent party it can believe in. "People don't feel respected, they don't feel listened to," says Xenophon. 

The Aboriginal leader Noel Pearson gave Xenophon a ringing endorsement this week in his National Press Club Speech. The real solutions for Australia's problems, he said, lie not with left nor right but with the "radical centre". Said Pearson: "The senator for South Australia, Nick Xenophon, is the closest we have to a radical centrist."

That took the total donations by Palmer's refinery to Palmer's party to a whopping $21 million over two years.

And both Palmer and Xenophon, the failed leader and the future hopeful,  have progressed in character. 

Friday was Nick Xenophon's birthday. He celebrated by buying himself a new fridge. When he defrosted the 20-year-old one he was junking, he discovered some food that had expiry dates of 2006 and 2007. He wasn't sure what he'd do in the evening, but thought he might have dinner with his ex-wife.

The day before, he'd approached his bank for a new loan to finance his political party, NXT, the acronym for the Nick Xenophon Team. It wasn't exactly high finance. Last year he borrowed $40,000 in his own name to put into the party. This year he plans to borrow up to $100,000 more, for a total of $140,000.

"I hope to get it all back through donations or public financing of the election," he says. "I'm a lousy fundraiser," though he did receive one large donation recently. Ian Melrose, of Optical Superstores, gave NXT $100,000 because he supports Xenophon's policy of favouring "buy Australian".

Obfuscating on the offensive

By contrast Clive Palmer, always a blustering, big-talking phoney, spent Friday angrily defending himself against accusations of mismanagement and worse. We'd already discovered that he's a political failure. Now there are mounting accusations that he is a dud businessman, as well. "His management of Queensland Nickel, from what we know to date, is shocking," Malcolm Turnbull said on Friday.

Last week his fully owned nickel refinery, Queensland Nickel, went into voluntary administration. Total debts outstanding are over $100 million, according to Friday's Financial Review.

Under scrutiny, Palmer obfuscates by going on the offensive. It's the old rule that the best form of defence is offence. So he attacked Turnbull on Friday: "Unlike the Prime Minister who invests his wealth in the Cayman Islands, I am a proud Australian who has invested hundreds of millions of dollars in Queensland and Queensland companies because I believe in the future of this country."

And why wouldn't he try to dodge the issue by making an attack? It's worked beautifully for him. Remember when he was under challenge by the ABC's Tony Jones for allegedly using money from his Chinese business partner, CITIC Pacific, improperly?

The Chinese company had paid $12 million to Palmer's firm, Mineralogy, to build a port. The Chinese company took Mineralogy to court complaining that the money went to finance Palmer's political campaign at the 2013 election instead. 

Palmer's response was to describe them as Chinese "mongrels". He went on: "They're Communist, they shoot their own people, they haven't got a justice system and they want to take over this country. And we're not going to let them." 

It worked because suddenly the story was about Palmer's outrageous remarks, no longer about the court action and the allegation that he helped himself improperly to $12 million. But, ultimately, bluster alone can't overcome the cumulative weight of Palmer's failings. Reality is forcing its way through Clive's smokescreen and slowly revealing the truth.

$21 million donated over two years

Curiously, a few weeks before Queensland Nickel put itself into the hands of administrators, it declared a  generous donation of $288,000 to a political party – the Palmer United Party or PUP. 

That took the total donations by Palmer's refinery to Palmer's party to a whopping $21 million over two years. 

That's quite apart from the other $12 million that the other Palmer company is accused of giving to Palmer's party.

But surely it's perfectly understandable for a Palmer-owned business to donate to a Palmer-led political party? 

Try telling that to Queensland Nickel's angry creditors. Hundreds of them met Queensland Nickel's administrators on Friday to demand their money. 

A company has legal obligations to its staff, its suppliers, its creditors, not just to its owner.

These include the 237 workers the company sacked just after it made the donation to Palmer's party, just before it put itself into administration. Those workers are owed $16 million in entitlements. All up, Queensland Nickel owes its workers $30 million. It owes trade creditors another $70 million, including $5 million that it owes the tax office.

But the political donations would be done on a purely arm-length basis, surely? 

The mere fact that its chief executive, Clive Mensink, is Clive Palmer's nephew would not blind him to his legal obligations, surely? And Palmer resigned as a director of Queensland Nickel precisely so that there'd be no conflict of interest between his business interests and his political party.

But then again, there is the discovery that a  company executive named Terry Smith had been sending emails approving capital purchases by the firm. Clive Palmer has admitted in a separate court case last year that Terry Smith is a favoured pseudonym.

Flagrant conflicts of interest

It seems that operating under conflicts of interest is endemic to Palmer. Endemic to his business practices as well as his political ones.

If the NSW system applied to Canberra, Clive Palmer could fully expect to be called before the ICAC now because of his flagrant conflicts of interest. 

He's a mining magnate, and he used his parliamentary position to oppose new taxes that affected his wealth. 

In Federal Parliament, he was pivotal in abolishing the taxes. The carbon tax is now gone. The mining tax is now gone. The crucial swing votes that made it possible were cast by the then senators from Palmer's party.

Then Palmer went on to agitate for a new law to protect bankrupt companies from their creditors, along the lines of the US Chapter 11 bankruptcy law. He didn't get anywhere on this, but the collapse of Queensland Nickel makes plain the reason he thought it such a good idea.

As the former director of public prosecutions in NSW, Nicholas Cowdery, told me last year: "It's a direct conflict of interest. He should recuse himself," disqualify himself from the discussion, whenever his party or the parliament are deciding their positions in areas where he has a personal financial interest. "Conflict of interest is a form of corruption," said Cowdery.

'Hey, we found a politician who has a heart'

Until the federal parliament introduces a code of conduct for MPs and senators to prevent such abuse of the public trust, people like Palmer will continue to be abuse it.

Fortunately, the Australian people saw through Palmer fairly quickly, more than a year ago. And while his party had a phenomenally successful debut at the 2013 election, going from zero to 5.5 per cent of the national vote at a single stroke, it's now collapsed to just 1 per cent or less.

The Nick Xenophon Team plans to field two candidates in each State for election to the Senate and another 20 or so to stand for the House of Representatives.   

A Morgan poll this week confirms that Xenophon's party is consistently polling higher than Labor in South Australia and can expect to perform well in that State at the federal election this year. Nationally, Xenophon is scoring only 2 per cent, though this is four times more than Palmer's party. 

Xenophon doesn't have the conflicts of interest, the bluster or the phoniness of Palmer. His party has three policy pillars – it's anti-pokies, pro-Australian industry, and in favour of government transparency. He is a sensible centrist. Xenophon says that Palmer failed because "he believed his own bullshit".

Xenophon's self-deprecation protects him against that, at least, but a startup party without a cohesive ideology remains vulnerable to the centrifugal force that besets all such parties.

Xenophon's frenetic work habits over the years have harmed his health. He's had heart surgery and back operations. He says that his surgeons have made jokes along the lines of: "Hey, we found a politician who has a heart." Or the other variant, finding one with spine. 

Palmer's collapse creates an opening for a hopeful Xenophon, but he faces a daunting task nonetheless. For many voters a bit of heart and spine will be more than enough.

Peter Hartcher is the political editor. 

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